Brno success stories: Kiwi.com – Virtual global supercarrier

Last year, it caused quite a stir when General Atlantic (having Uber, AirBnB or Flixbus already in their investment portfolio) bought a major stake in Brno based Kiwi.com (for GBP 100 mil., some sources reveal). The online travel-tech company achieved a turnover of USD 1.5 billion and about 15,000 orders – a day. 

We spoke with Kiwi.com CEO, Oliver Dlouhý, about the ups and downs of doing business from Brno and the key factors to their success. His is the 6th in a series of interviews with the personalities behind notable Brno companies that operate internationally.

Oliver co-founded Kiwi.com (originally named Skypicker) in 2012 after his personal difficulties to find an affordable flight combining non-cooperating airlines. 

Now, Kiwi.com includes flights, trains and buses and has customer support sites in Philippines, India, Ukraine, Colombia, Tunisia & China; and development sites in eight European cities from Barcelona to Beograd. In total, the company employs 1,300 people (plus double the number working for them through partner companies). Their employees are of 65 different nationalities, and over 1,000 of them based in Brno. 

Kiwi.com business

Their product solution is based on their large database (covering more than 800 air and ground carriers, which represents 99 % of the existing market) and a smart algorithm. 

The business started on a B2C model, but the rocket growth came with a B2B2C model based on revenues brought by searches like Momondo or Kayak, which now represent about 60% of sales. The rest 40% are B2B sales (sales through companies with no Kiwi.com branding) and direct sales to end customers. 

The most interesting part of their story is that Kiwi.com isn’t only about flights anymore. You can also buy insurance, accommodation (Booking.com capacities will be fully integrated soon) and other connections like trains or buses and soon also taxi, Uber etc. No matter the combination of carriers, Kiwi.com guarantees it’ll take people to their destination, even in the event of a delay or cancellation.

Oliver uses the term virtual global supercarrier. Kiwi.com could also be called a holiday integrator, allowing many services to be booked within one transaction and payment.

What’s next? What’s the next level of travel integration? Oliver sees the answer in destination activities (such as renting a car or scooter, dining and more). When customers come back to the portal, they’ll be able to find vouchers for the local leisure activities (usually generating about 50% of the total individual travel cost).

The recent partnership with Malaysian Air Asia is supposed to increase Kiwi.com’s revenue share in Asia (right now, it stands at 28%). So far, the key region is Europe with 40%, the US adds another 20%. 

Home in Brno

Oliver doesn’t live in Brno himself. Instead, he commutes 170 km almost every day. Even as an outsider, he still appreciates Brno as an authentic safe city, pleasant by size and lifestyle. It’s not overcrowded by tourists and has a high quality of living – lower cost & globally competitive salaries. 

Kiwi.com grew on university graduates, and it keeps recruiting them in significant numbers every year.  Hackathons are another important source of talent, and so are other events (about 100 a year) organised by its community team around the globe.

The local talent pool is certainly limited. That’s why Kiwi.com is currently introducing the location agnostic collaboration framework, enabling employees to work remotely from anywhere. Their HR primarily targets people who like travelling and live the style of digital nomads. The company believes this is the future and this benefit will bring them a competitive advantage. 

Oliver (who still owns about one fifth of the company) doesn’t list the factors critical for the company’s success. Instead, he highlights ‘their good luck for finding the right people, and their sense of fair play’. The preferential exit strategy for him is going public.

As a company dedicated to the global market, it’s diverse by design. ”Foreign human capital is the key. That’s why one half of our board is non Czech,” Oliver closes.

Kiwi.com in numbers

2017 2018 2019
Turnover (in mil EUR) 694 1100 1278
Employees worldwide 740 1380 1310
Employees in Brno 908 1010 1096
Share of R&D costs (in %) 5,4 9,8 15

 


Oliver (32) is the younger half-brother of Vladimir and Michal Dlouhý, both Czech successful actors. He appeared in the Financial Times ‘New Europe 100’ list of Central and Eastern Europe’s brightest and best people in 2016; in Forbes ‘European 30 Under 30’ in 2018;  he became the Person of the Year by the Czech Awards ‘Křišťálová Lupa’ and won the Czech EY Entrepreneur of the Year in 2019. He was featured on the March 2020 cover of the Czech Forbes magazine.

Note: The interview took place before the Covid-19 pandemic and it doesn’t contain any information regarding the company’s current operations and activities.

Picture by Kiwi.com

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